Mt K Kapital launches $450-million private credit fund, GPs commit $100 million

Mt K Kapital's first fund was a fully equity fund

Mt K Kapital, the alternative investment arm of the Rustomjee Group, has launched its second fund, a real estate-focused private credit vehicle, targeting a corpus of $450 million (around Rs 4,017.63 crore).

Mt K's founder and managing partner Binitha Dalal told Moneycontrol that the firm has secured commitments from several institutions. The fund's general partners (GPs) have committed around $100 million, she said.

“Our first fund did very well, and has provided internal rates of return of around 25 percent. We are now filing for approvals from the Securities and Exchange Board of India (SEBI). We have received all the commitments needed for the fund to reach its full size,” he said.

Mt K's inaugural fund, a Rs 790-crore equity fund, has been fully deployed in Rustomjee’s ongoing residential and commercial projects in the Mumbai Metropolitan Region (MMR).

From 2026, Mt K will look to deploy capital from the fund in the initial stages of projects across major real estate markets.

"We are now looking at the pipeline for investments and we will be looking to be involved in the project from the land-purchase stage," Dalal said.

She added that Mt K can work with developers of all sizes, while also looking to "hand-hold" them in reducing costs and construction timelines. This also includes better sourcing of raw materials, using price arbitrage data across the projects financed by the second fund.

The fund would target an exposure of around Rs 250 crore to Rs 300 crore in a project and will look to fully exit it before the completion of its cycle, Dalal said.

While Dalal did not elaborate on the sources of funding beyond the general partners, she confirmed that commitments for the fund were received from a variety of institutions, including family offices.

The first fund received investments from entities such as the State Bank of India, ICICI Bank and healthcare firm Famy Care.

Dalal said the fund will receive a portion of the capital through the GIFT City route, utilising a feeder fund based there, with investors seeking to repatriate capital while also taking advantage of favourable exchange rates.

According to a recent Knight Frank report, India has emerged as one of the fastest-growing private credit markets for real estate in the Asia-Pacific region.

Alternative investment funds (AIFs), which include both private credit and private equity instruments, injected Rs 74,000 crore into real estate till December 2024, the highest among all sectors in India, Anarock analysts said.